A. Field of the Invention
The present invention relates to a method of charitable giving. More specifically, the present invention relates to linking charitable giving with investing and consumer purchasing.
B. Problems in the Art
Throughout the world, there are people who are underprivileged and lack some of the basic necessities of life. For various reasons, these people do not have the financial means to provide for some of life""s basic requirements. A variety of programs exist to help these people, but they all fall short in one respect or another.
One of the major providers for the needy has been the government, both at the state and federal level. State governments have provided programs such as unemployment compensation. The federal government has provided programs such as welfare, food stamps, and subsidized housing. However, due to bureaucratic inefficiency, many of these programs produce a great deal of waste. In addition, many people resent government-directed social services programs.
In addition to the various government programs, a number of charitable groups exist to help the poor. The United Way, the Salvation Army, and church related groups are examples of such charities. In many instances, these groups do an excellent job of helping those in need. Sadly, these charities often suffer from a lack of funding, so they cannot help all those who need it.
Due to the shortcomings of government programs and the paucity of funds currently given to charities, there is need for a method which will increase the funding for charities. The present invention helps meet this need by linking charitable giving with investing and consumer purchasing.
Currently, there are many charities and many different investment vehicles. Popular gifting methods include xe2x80x9csplit giftsxe2x80x9d where the distribution to charity is deferred until the death of the donor. In many cases, years pass before the charity actually receives any money. There is a need in the art for an investment/purchasing process whereby money is automatically given to a charity on a regular and timely basis.
Therefore, a primary objective of the present invention is to provide a method of charitable investing/purchasing that will help address problems and deficiencies in the art.
Another objective of the present invention is to provide a method of charitable investing/purchasing that will increase the amount of funds that are donated to charitable groups.
A further objective of the present invention is to provide a method of charitable investing/purchasing that will decrease the need for governmental assistance programs.
A still further objective of the present invention is to provide a method of charitable investing/purchasing that spawns new charitable financial instruments.
Another objective of the invention is to provide a method of charitable investing/purchasing that is easy to implement and efficient in operation.
These and other objects, features, and advantages of the present invention will be apparent from the following specification and claims, in conjunction with the accompanying drawings.
A method of charitable investing/purchasing involves the use of a financial instrument or a financial account or service that normally has an embedded fee structure. For example, one such financial instrument is a mutual fund which typically charges an annual fee to investors for investment management and administration. Other examples would include unit trusts, life insurance policies, annuities, brokerage accounts, and trust accounts, among others. From the fees normally deducted from the value of (or earnings on) the investment instrument, account or service, a portion would be redirected to a charitable community foundation account (a xe2x80x9cdonor advised accountxe2x80x9d) over which the donor has the right to provide nonbinding instructions with respect to charitable distributions to be made from the account. Further steps include introducing a donor to the community foundation and this charitable giving process, and advising the donor on the financial and philanthropic benefits of this process. The investment advisor and the person who introduced the donor to this charitable giving/investing process (the xe2x80x9ccharitable liaisonxe2x80x9d) would receive compensation from specified parts of the standard fee.
A second embodiment involves a purchasing account, such as a credit card or debit card account. The difference between what the consumer pays for purchases and what the credit/debit card company pays the merchant represents a fee paid to the card issuer. Part of the fee from this specially structured credit/debit card would be given to a charitable community foundation donor advised account. Other parts of the fee would be used to compensate the consumer""s investment advisor, if any, and to compensate the charitable liaison.
Rather than a credit/debit card, the account could be a brokerage account, or any other account or financial service to which a fee is applied. Part of the fee is given to charity. Other parts of the fee can be used to compensate the donor""s investment advisor and the charitable liaison.